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tv   Mad Money  CNBC  May 29, 2013 6:00pm-7:01pm EDT

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>> wait till tomorrow. i'm melissa lee. see you again tomorrow for more "fast money." meantime, don't go anywhere. "mad money" with jim cramer starts right now. my mission is simple, to make you money. i'm here to level the laying field for all investors. there's always a bull market somewhere and i promise to help you find it. "mad money" starts now! hey, i'm cramer him welcome to "mad money," welcome to cramerica. other people try to make friends, i'm trying to save you money. my job is not just to teach to entertain an coach you. call 93 at 1-800-743-cnbc. all right. sometimes this margaret, you know a lot it's like? it's a lot like baseball. say you have a man on, if you
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have a big lead off the bat. you would love to take 2nd base. you take your eye off the ball t. pitcher nails you. that was whaps what was happening today until the dow rebounded at noon. of course, we are investing in stocks. we're not playing a game. but the analogy works because the people who lost money today were the ones who thought they were safe in stocks with good yields. they're in a similar position to a runner on 1st who just hit a single and didn't expect the pitcher, in this case the pitcher is the bond market, to be able to whirl around and naim nail them. you are complacent and confident one minute. you are plain out the next. head down, walking to the dugout, kicking yourself, furious at yourself because you
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thought you weren't vulnerable since you just arrived safely at 1st and didn't think you were exposed nearly as much as you thought. that's what happened today and yesterday afternoon. for the last longest time i have been talking about saver's us a territory. that's the process by which the federal reserve lowered interest rates down long enough to give access to cheap money. we know, of course, only the most qualified borrowers were able to get money from banks. we know from aig, you need a fico score of 750 to qualify for a bigger mortgage. we know that housing prices are coming back. a stackering figure that combined with the rising stockmarket has made people feel much wealthier, even though we are down from the 2006 high for homes, not stocks. hence, why we just saw these statistics yesterday showing americans were confident about the future than any other time in the last five years. that's good news, too. it's all good news for the
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economy. it means people are spending more money on their homes, the pricelessens the mortgage, we foe from home depot, senator mccall, money owners are three times to spend money and improve their house than those under water. given the average person spends $1,000 at home depot, you can see how bound fiful is the when the mortgage rates come back to light, more are coming back to life every day. it means banks are more willing to lend to home buyers, because they know the collateral the home, itself, is increasing in value. at the same time, people have started opening their 401k statement, they're not afraid to look. they like what they can see. it means they can be less tight fisted. less worried they will never be able to retire, in large part, because so much money has been lowered on fixed income, bonds kept down specifically by ben bernanke in order to get this
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exact wealth effect i just described going. he predicted correctly, i might add, mentioning the shadow inventory on homes will be worked off. they're almost gone now. he knew we built so few houses vs. the demand that we ought to have a housing short annual, which is accident happened when the combined homes built in 2009, 2010, 2011, barely meets the ones we had in 1960s. we are an pace to have 200,000 homes this year. i would say we need 2 million, another goal of bernanke, his goal is to promote job growth. a lot of people benefit when housing roars back, including the people who build those homes. but all this good news comes at a cost. not one i'd emphasize in this show. i like a buoyant stockmarket t. cost is on the one, the ones who bear it are the safers.
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typically, have not worried because as benefit bernanke said over and over again, it's great to save. if you don't have a job, what does it matter? the savers, people who have nothing to show for their investment, if they chose to stay in fixed income assets, which historically have been the prudent places to be. they're the ones hurting. it is not prune to the earn nothing on your money. i will tell you about those who can't survive on a 1.5% certificate of deposit. that is the going rate for a cd or .yen 18% if you want to go daring. they are the ones penalized for staying cautious. that itself saver us a territory i'm talking about. that's what i'm trying to get in your mind. because there are so many us a territories savers who need the reach for income. it was only natural they gravitated toward higher risk bonds or bond funds that gave you even bigger pickup or ultimately, the stockmarket. particularly, the part of the stockmarket that offers the highest yields for what is perceived, not actually, but perceived to be the least risk.
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the utility, investment trust. some ventured to higher yielding common stocks with much more risk like the trucks or the food names that used to yield 3-4% before they skyrocket. we consider these bonds stockmarket equivalents. they also had more ring because the stockmarket gave us no guarantees you'd get your money back. as these troops rallied and rallied, their yields slampg. they became owe shrank. they became the equivalent of something too risky. most of these picked off savers, they weren't trying to hit home runs. they weren't going for the fence, far from it. they didn't expect to be called out as they have been here. they just thought, hey, listen, we can bunt, get on, run, get a single. that's all they were trying to do is get on base with income instead of striking out or sitting in the dugout with bonds, getting almost no return at all. oh, it was a terrific strategy
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as long as the bond market competition, consider him the pitcher on the pound didn't attempt to pick you off with a sudden jolt in rates. consider that pickoff move. it's been so great and the federal reserve has been so adamant that it wasn't going to let the pitcher fool you that an amazing complacency set in. no one can blame you. that complacency ended yesterday with a sudden almost violent move in bonds that seemed as unexpected to the base runner as i have seen. those who thought thai they were playing safe found themselves shamelessly back to the dugout. yes, the pickoffs continued today, with the drugs, the foods the consumer stocks, as hard hit as the le electric utilities and master partnerships. perhaps if worst hit are those savers buying bonds, like if recently issued apple bonds, they're paying a couple percent. those fell a quick 8 points from 192. just like a stock. it's brutal. so, what do do you now?
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first, we don't know if the pickoffs are done. will rates continue rise, thereby nailing anyone still on 1st base, are they going to be steady and therefore they have fallen enough to give you a safer return. the next move depends on whether the economy is getting stronger. if we get lower unemployment claims next week, then no yielding seeking base runners will be safe. i don't want to bet against. the economy is producing more good data. we can't afford to stay complacent as i don't expect automatic macro-data to be as strong as housing. you are not paid enough to take a risk of taking a lead off 1st base. we certainly ampbt in shape to steal second. you the take your single and go home for now until interest rates and stock yields have gone so high that it's, once again, safe to hang out on 1st. think about it like this, if you are in a stock in a stock solely for the yield, that stock is a
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candidate for sale on any bounce tomorrow. if there is more to it, then hold on. you'll be fine. here's the bottom line, it is not worth being picked off here by a bond market that's got you leaning the wrong way. take some profits on those once higher yielding stocks. it isn't so good anymore. you can get in lower. sure, you want income. it isn't worth the reach given the stretch variations and yields, much stronger than they were that can be quickly wiped out by a couple of percentage points dedliens in the stockmarket prices. stay in the dugout. your return to hit singles will come around much sooner than you think. bill in virginia. bill! >> caller: hello, jim. it's good to speak to you. >> same to you, bill. >> caller: i would like to give you and katy a virginia tech boo-yah. >> bob: hey, listen, brian had the mayor of smithfield, the town on his show.
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that guy makes a lot of calms. lief it. what's up? >> caller: okay. my question is, in light of the recent good economic as well as good auto sales news, gold is having a great rup. but at what price could you consider ford to be overvalued? >> i recommend $4 to $18 in yaurn, 2011. the stock got cut in half. i think when it gets to 18 again we will relook. right now, my charitable trust is buying for it. why? because if europe is bottoming, the amazing f-150 is selling like ahmad, that means higher margins, higher dividends, higher stock prices. tom in florida, tom! >> caller: a warm florida baja to you, jim, from the gator nation. >> love the alligators let's not slight the knolls. >> caller: of course not. my question is about smithfield
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foods. would the announcement made and the ascent move in the price of the stock today, is there any money left to be made in this trade or is there another name that you like? >> this is a great question. i spoke on my morning show "squawk on the street," i directly questioned them and said, don't you think there will be a higher bid? he did indicate there may be other bidders. when i hear that, i think i will hire, but we're not greedy, sell half tomorrow morning. for the love of the game, you know we are at one of those moments you can stay on the bag, go back to the dugout, until the rick is on your side. it's just not worth it being picked off right now by that bond market. i know, i know a lot of people are saying, don't worry. you foe what, i said, don't worry for the last 8,000 dow points. me, i'm a little concerned. let's just see what the bond market does. coming up, strong as steel? industry is beginning toet hoo
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up in the u.s. and tonight cramer has an exclusive look inside. from questions on our aging infrastructure to how natural gas is changing our manufacturing future. don't miss this interview with an industry veteran. and later, finding cover, the market isn't the only thing under attack. the sequester threatened to force a retreat in the defense sector. but some of the industry continues to march past the mark. can they seep kindergartening on? don't miss what's the on cramer's radar. just ahead. all coming up on ahmad money. don't miss a second of "mad money," follow, @jim cramer on twitter. have a question, tweet kramer, hashtag ahmadtweets. send him an e-mail on "mad money" of give us a call. 1-800-743-cnbc.
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. all year i have been talking about the north american energy revolution. the natural oil the last three years can transform our economy and tronz form it for the better. when i saw the chairman of new core, the big steel-maker wrote last month how his company is using cheap domestic gas for the kind of iron used in steel production in america. new core has a partnership with encana to drill their own natural gas well to insure the stuff of the supply for decades to come. i have been telling you it will make the united states a more attractive place to operate for all sorts of domestic companies. it now includes $100 billion worth of new industrial projects and planned projects who can afford it if the company allows more facilities for liquifying and exporting our natural gas to other countries. he thinks it makes sense to keep prices low domestically like every at part of the country. rather than exporting this stuff at a higher price.
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regular viewers know we made transport stocks. i still think it's a shame that we aren't making more use of this cheaper, cleaner fuel here at home. so let's check in with the second chairman of new core to hear more about this natural gas resurgence and renaissance. mr. di micc orks welcome to "mad money." >> hey, my friend. >> it's been too long. you are dog amazing things. i want to talk about nucor technology, why it works here versus building elsewhere. >> well, you know, there is nothing better than new technologies, game changing technologies come along. what's come along with fracking and horizonal drilling is nothing short than a massive game changing vent for this country, our energy situation and domestic manufacturing and a resurgence in it. what we are building in louisiana is a direct reduced
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iron plant. we have one in trinidad. we moved it from louisiana back in 2000 because we can get $2 natural gas down there and we're happe happy as can be that we are building our next one here in the united states but to insure that that direct reduced iron will give us the cost benefits we are looking for, somewhere around $80 to $100 a tonne over our competition. we needed to make sure we had a long-term stable low cost natural gas supply. that's where the partnership with encana comes in. the beauty of this partnership is that we are not putting $3 billion up front to buy the rights. what we do have a is a pay as you go capital investment joint venture with them where we will be investing somewhere between 2 and $350 million a year at peak production around 2017, be producing somewhere in excess of 125 billion cubic feet per year
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of natural gas of which we will use, all of that if we build four dri plants. we are currently building one with accommodations for a second. this truly is a major event because you are looking at a billion dollars of expansion and existing operations to take advantage of this low cost natural gas supply. this is big stuff. >> but, dan, i know it's big stuvgs but let's take the other side for a second. what happens if we have so much natural gas in this country that a few plants that export wouldn't necessarily hurt the supply/demand situation? >> well, listen, we're in the against exports. we're against extreme exports. i mean, there is 20 projects that people have applied for. we haven't even started to reap the benefits ourselves yet. people want to export 40% of our production. that's what we're against. we're not against exporting 10, 15% of our production.
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but here's the facts, charles river associated just completed a study where if you take natural gas and out it to create manufacturing jobs, which is what that 100 plus billion dollars is going for, you create twice a direct economic value to our economy as does liquified natural gas of exports of an equivalent amount. not only that, but you create eight times the number of jobs. this is a no-brainer. okay. this is where we should be using this for comparative advantage, not exporting that advantage around the world. we're in the against exporting. exports are going to take place. but we are against excessive exports and undermining the renaissance of manufacturing that it's going to drive. >> fair enough. we are big supporters of shaneer. they are big movers. they deserve that advantage. yes, i agree with you. will suki is talking 2 to 3 to
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4% of export. i think you can live without that. not a problem. now, what i need to understand from you is whether we will ever use natural gs for anything other than -- gas for anything other than industrial purposes. the way you are describing it, we should be able to harness surface fuel for vehicles at $2 and natural gas we would take over the world with that? >> well, natural gas will probably be a little more expensive than $2, but it's not going to be the excessive numbers we've seen in the past and the wide swings up into the teens. you will probably see natural gas somewhere between $3 and $5 for sometime to come. that will allow us to do a lot of great things. there are still some skeptics out there. i sit on the board of duke energy. the utilities in this country have been burned before by jumping into natural gas and then having prices go through the roof because supplies dwindle.
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that's not the case today. today we have a permanent ie 100-plus year supply of low-cost abun davent natural gas that's going to drive power generations to natural gas, manufacturing and chemicals and fertilizer and steel-making and other energy intensive industries and it will start to have an impact on transportation. you know the burlington northern and other railroads are looking at using natural gas to fire their locomotives instead of diesel. the trucking industry, t. boone has been a big propanet of. that he's right. for sometime, infrastructure build will take place that will support its use in other forms of transportation and it will be a big, big positive for our energy independence and keep in mind the best way to achieve chief energy independence is to not have a net effect
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port/import of zero. the best thing is not to import anything and have all of our energy needs being supplied from home. that's not going to happen. but we can get pretty darn close with the exports coming in from our friend in mexico and canada. >> in the meantime the economy is saying the economy is coming back. i go through your utilization and steel and the commercial, real estate investment business. it ain't happening. if anyone thinks the interest rates should sky high, i am seeing from you and your company there is still not enough business. >> all right. there is a serious disconnect between what we see and wall street as an example and in some manufacturing sectors and nonresidential -- even residential construction. very slow recovery from a very deep downturn. it's taking place, but much, much too slowly. i mean, if you have gdp growing at 2% or less, you are not going to get a lot of construction going on. you know, our government has
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missed the boat. five years ago, we should have started a massive spend on infrastructure, which is a major investment that would have paid itself back as opposed to being wasted like some of it has been. i'm talking about real infrastructure, not talking points. electioneering. you know, we've got a 2.5 to $3 trillion hole to fill, not a $50 trillion ohio let's get real in washington. let's find ways to pay for it. don't increase our debt. there is a lot of interest on the private sector to support funding, but the economy has not provided the kind of growth in the construction sector that we would normally see at this point. it probably won't. we probably won't see a strong market for another year or two. >> yeah, thank you, dan. dan, you have always come on the show and told the truth. have you done it again, dandy micco, chairman of nucor. thank you for coming on. >> thank you. >> industrial renaissance, incredible opportunities.
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one of the reasons i remain bullish on america. dan knows. i got to tell you. his comments about steam. wow, we still got a lot more work to do in this country. stay with cramer. coming up, finding cover. the market isn't the only thing under attack. the sequesters forces a retreat in the defense sector, but some of the industry continues to march past the market. can they keep soldiering on? don't miss what's on cramer's radar just ahead. plus, dirty laundry? there is a battle brewing in the aisles you frequent. some of these brands may succeed. cramer has his eye on one company that may begin to struggle. stick around and make sure this company is not in your cart. ♪
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while dramatically reducing waiting time. [ telephone ringing ] now a waiting room is just a room. [ static warbles ] expected six months ago. some groups are doing so well it's almost unbelievable including sectors that just about everybody believed were going to get pulverized, not that long ago. take the miraculous rally in the defense contractors. hallelujah! >> i say miraculous because these stocks were supposed to keel over and die once the sequester went into effect with its huge cuts to military
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spending. rather than going down the defense rates are judge higher. lockheed martin, boeing with substantial defense biz. 31% since the beginning of 2013. out of that 787 thing. what the heck is going on here? these companies are all highly dependent on spending from the u.s. government. [ music playing ] pretty much everybody in the world of politic, both democrats and republicans told us the sequestration would mean huge cuts in the defense budget? am i missing something? when the sequester became a reality, it had $487 billion, that's an 8% deduction from previous budgetsment that's over a ten-year period. we're talking nearly a travel a trillion with a t, dollars taken away. that's why so many sold the defense stocks in november when the elections began to say to the fiscal cliff was a serious issue. they were terrified the politicians would allow the cuts
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and sequester to happen, unbelievable. it turns out, their fears came true. sequestration went into effect four months ago. the worst happened, yet the defense stocks have been roaring. this is a fabulous bull mark. so we need to ask ours, how is that possible in more important, can it continue? first of all, as time goes on, it looks leak our sequester worries were blown out of proportion. this is a case where the analysts got way too negative. they got spooked by congress and spooked investors exactly at what turned out to be the wrong time. the more sequestration cuts supposed to happen are the law of the land on paper, but in reality the government has been slow for the defense spending and pushed the decisions to the end of the year. lock heed martin told us, this is a good company that the government has yet not yet informed them, not yet informed them of specific decisions taken in response to sequeststration
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except in very limited circumstances. in other words, the pentagon is dragging its heels in dragging spending cuts until 2014. so what? even if the government is kicking the can down the road. doesn't that mean they are doomed? not so fast. the longer the defense cuts are pushed down, the better chance they'll never happen. you have to understand the way this process works, i learned about it doing this piece. very few people in washington want these defense cuts to go into effect. democrats and republicans. the president and congress can pass a budget for 2014 or a supplemental budget. that trumps the sequester. the budget president obama proposed for next year reverses the sequester. even though that budget is a starting point for negotiations and washington is proved to be incredible dysfunctional lately, the fact is there is a good chance they outlie the sequester may never come to pass. plus, we got this defense review coming up this summer.
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hey, that's as big an analysis the government does every four years. it's like having a major impact on where the pentagon's money actually goes for years to come, again, men mizing the sequester. but even if you are bearish on the whole situation. even if you believe the defense cuts have only be postponed, not prevented. it's still not the end of the world for the larger defense contractors like lockheed martin, raythe raytheon. in boeing's case have a terrific commercial business that is just roaring in year two of its cycle. the big one, last month, they announced an 11% dividend boost, along with a massive buyback that will allow the company to retire a quarter of its outstanding shares through 2015. i did not believe this within i first saw it. i said a quarter, i had to read it over again, that's extraordinary.
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i cannot recall any buyback that big in that short period of time. this is a company that gets the majority of its sales from the u.s. government, mainly the defense department. it's exactly the kind of business people are scared will be cut by the sequeststration, which is why they sold it and insured it. now, citigroup upgraded this morning, pointing to the titanic buyback and the fact that the company is shifting its business towards more international orders and procurement contracts, which typically bring in higher margins, predicting what the government can go next is tricky. whatever happens, it's not too bad to buy north of grumman. they have the cash. the buyback is staggering to me. listen, i like lockhe'd marin, too. they posted a between cents earnings beat on a report five weeks ago. what a quarter. while i am concerned about higher yielding stocks in generals, one that's cheap by lockheed martin, it doesn't
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bother me, north of grumman is beau better. i like boeing. it has a big offset. >> the house of pain. >> no. >> house of pleasure. >> especially with the orders of the '77s taking off here, mick i the ceo is a great man. the war in afghanistan is winding down. i'd be more cautious about the smaller players, the texttrons. they are less diversified, more important, they have less political clout than the big boys do. the bottom lean is this. this run in the defense stocks as implobl as it -- improbable as it seems, the sequester cuts are supposed to cause a lot of pain haven't happened yet. might not happen at all. i think north of grumman with
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its gigantic buyback are worth owning right here even if washington can't get its act together and pass a budget that trumps the sequester. it's incredible. this is the kind of power that i come to expect from this stockmarket. chris in arizona. chris. >> caller: yes, boo-yah, jim, honeywell, a current run in price. do you think there is an 80 possibility for a stock split? >> when we think of honeywell the ceo, we think of dave cody. that stock goes to 75, 76. i never close my eyes and buy anything but, buy, buy, buy, regardless of a split. jim in virginia. jim! >> caller: boo-yah, jim from the great state of northern virginia. i am calling you about a stock i provided by monday daughter so she can learn about the markets and this firm t. company is the largest independent denier and manufacturer of aero structures in the world splieg boeing and airbus, a real sweet spot.
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what do you think of aero systems? >> i like it. from wichita. it's a terrific company. i will tell you if you want both airbus and boeing, i'm going to send you back to what a previous caller said you didn't hear is honeywell. i think it represents better value. spirit i would never tell you to sell. go to greg in missouri. greg. >> caller: yes, yes. >> hit me. go ahead, greg, you are up. >> caller: yeah, i'm here. >> okay. good, why don't we talk stocks? >> caller: okay. jim, i want to thank you for your mark expertise. it's a great help. >> thank you. >> caller: my stock is erickson air crane, ticker symbol eac. any price below 25 means i lose out of pocket capital. unfortunately, i have all my eggs in one basket. jim, should i sell or hold? >> well, it doesn't matter how good it is, we could be talking about the greatest stocks since
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strohman's sliced bread. you cannot put your ecs in one basket. i do like eric zorn, it's down too much since it waim came on the show. no more than 25% this one stock. we are too old. you and i are too old to play that game. cut it back. if you find yourself thinking what the heck? we got to dig deeper. this rally and defense contractors in the face of the sequester, well, let's just say it makes a tonne of sense because it hasn't even kicked in. northrup grumman is the best of the group. stay with cramer. oh, he's a fighter alright. since aflac is helping with his expenses while he can't work, he can focus on his recovery. he doesn't have to worry so much about his mortgage,
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groceries, or even gas bills. kick! kick... feel it! feel it! feel it! nice work! ♪ you got it! you got it! yes! aflac's gonna help take care of his expenses. and us...we're gonna get him back in fighting shape. ♪ [ male announcer ] see what's happening behind the scenes at ♪ je t'adore ♪ c'est aujourd'hui ♪ ♪ et toujours ♪ me amour ♪ how about me? [ male announcer ] here's to a life less routine. ♪ and it's un, deux, trois, quatre ♪ ♪ give me some more of that [ male announcer ] the more connected, athletic, seductive lexus rx. ♪ je t'adore, je t'adore, je t'adore ♪ ♪ ♪ s'il vous plait [ male announcer ] this is the pursuit of perfection.
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. it is time! it's time for the lightning round. i tell you whether to buy, buy, buy, or sell, sell, sell. when you hear this sound, len e then the lightning round is over. are you ready, skeedaddy? let's start with brad in new york. brad. >> caller: hey, how are you doing, jimmy?
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>> good, partner. couldn't be better. >> caller: i have a question about nq mobile and your thopts on it? >> way, you are way to speculative. i have problems with verizon, i say, don't buy. let's go to robbie in hawaii. >> caller: aloha from hawaii. my federal realty. >> i love tom wood, there were stocks that used to give me a good yield. you go to the wait for higher yield, 3.5% you can pull the trigger. chuck in florida. chuck! >> caller: boo-yah, jim. >> boo-yah. >> caller: from south florida. neurocrine biosci. >> it's a spec, it's a dice roll. girard. >> caller: hey, from hilton
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head, south carolina. >> i played golf there ruined the whole course, what's up? >> caller: nay traded today. >> we can't. we don't know what they own. we know the whole bond market is being convulsed and the kind of companies pull back from this agnc. they're too hard. we foe they can be poorly positioned. let's not reach for a yield. albert in arkansas, razorback. come on. yo-yo. >> caller: hey, jim. >> speak to me. you are up. >> caller: hey, jim. >> yeah. >> caller: all right. albert in arkansas. >> i had a feeling. what's up? >> caller: pretty good. i'm trying to figure out what's going on with cvr partners, should i buy, sell or hold? >> it's a fertilizer company where a lot of people are worried about the agricultural market. i, myself, feel it's at the right level. i am going to say that you can buy. i'm taking one more.
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arlene in california. >> caller: hi, jim, how are you? >> how are you, arlene? >> caller: about the pending merger between sprint and nextel. do i stay and buy? >> i like sprint. he'd be the man. that, laejs, is the conclusion of the lightning rounround! >> how are you, arlene?
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a down day. only one day the all time high for the dow. another up tuesday. home prices are rebounding. despite the good news, we were in the red today. it goes to show you now is not the time to be lazy. you need to dig in your heels protecting for days like this. let's put your picks to the toast on tonight's round-up? am i diversified? if you owned those good stocks so good so long, you got crushed. thafrls not being diversified, call me or tweet me @jimcramer. i didn't tweet that much, i was
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with my kids. maybe you need to mix it up a little. why don't we start with a tweet from hein rick underscore thuren who tweets am i diversified? boo-yah to you right back at you sun shooen. here we go. that dividend has got to be way too large. oil, ciscosysco provides restaurants with food, northern tier, verizon, a high-year-old, got to get higher, ben doing a good job. aig, restaurant, oil, you know what, thuren's got it going. ham lieuia! >> okay. now let's go to brian in connecticut. brian. >> caller: boo-yah, mr. cramer.
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i have a portfolio. i have two concerns about this. the first to stock is gld, jcp, j.c. penney, nordica american tanker, mark west and sea gate stx. my first concern is jcp. >> i will go over those. do a little qualitative. what you god here is high yielders in north american tagger, that yield is high because the stock has dropped. mark west high yield, it's gone up too far. you have oil, tanker, gold, you got tech and you got retail. j.c. penney's has enough money to last this year, not that worried. mark west, mr. sellple seems like a strong story. i know, holly cow, gold i prefer gold coins.
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rudy versified with tech retail, oil, shipping and the gold shares. gas, oil, a pipeline company, i'm going to say that's different enough from nordic american. lawrence in st. thomas, lawrence. >> caller: yeah, hi, how are you? i'm a big fan of your program. i appreciate all you do. i have let back to even so many times i worn the pages out. >> holy cow, that deep in the money option, many thought that was too hard. >> caller: i really appreciate all you do. i have several stocks i wanted to mention. i have nation, star mortgage. gilead, gild, sbux, starbucks. tol, tolle, tjx for t.j. max. >> let's see, interesting, interesting names. okay. we got, this is a banking play. i was thinking national semi
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conductor. it's a mortgage, toll brothers, housing play, a problem there. gilead the great biotech. t.j.x. starbucks, we got to get a health care company. we have health care. let's get an industrial in here and let's sell nation star mortgage, ring the register there. we'll bring in a, let me see, what do i want there? why don't we me in a technology company. i'm going to say, you know what, homage to david favor, i'm going to recommend hewlett packard. can you believe it? hewlett packard. i just said it. that's because of the dell deal t. dell deal will make it. that's a nod to david favor. thank you all for playing am i diversified? ♪
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the repairs are guaranteed for life. so call... to talk with an insurance expert about everything that comes standard with our base auto policy. and if you switch, you could save up to $423. liberty mutual insurance -- responsibility. what's your policy? you want a good, long short pairs trade like the hedge funds are talking about. a combination of something you want to sell short, a stock bet against something you should buy, another stock. how about selling the stock of procter & gamble. now the company let ceo bob mcdonald go and replaced him with his predecessor and buying a similar package play tore hedge the short out. this is all about execution. you are making a bet one company will perform better than the other regardless of the overall sector.
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that itself the hedge. when it comes to execution, i was unusually no fan of bob mcdonald when he came to the job. i thought even though mcdonald had a terrific rep takes as a brand manager, particularly in china, he was failing to take the tough action needed to insure his company has a place in the global world. in fact, at the beginning of last year, i put mcdonald on the "mad money" wall of shame because of his failure to deliver growth and the overrebellion of the analyst calls, they were an excruciating fair. last summer, he had some reorganizations that allowed proctor to take out $10 billion in costs. much of these savings came from trimming the fat that mcdonald's predecessor, a.g. laply allowed to develop. in the mid-'60s it appeared mcdonald hasn't been dealt the treasured hand that they thought laply had given him. there were l many leaders and divisions to fall behind. the lag was follow bid a world
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wide boom. i wasn't dismissive in the not taking the actions that proctor needed. i didn't dismiss him. he didn't do it himself. he convinced me i should take him off the wall of shame before everyone else realized he refined and strictly hair care which had become a lagging care and deter gent, i got behind mcdonald big, recommending proctor at 65. next thing it frafls to 68. it was true if the last quarter was not off to snuff, however, the stock was roaring at that time. i thought mcdonald earned the benefit of the doubt for another year. last thursday, we find out mcdonald is out and laughly is back in. -- laffly is back in. i don't want you to short
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procter & gamble outright in case of the packaged goods take off if rates go back down. kimberly clark plumed 5 points. that's a candidate to the hedge for certain. i like colgate more important than proctor. another hedge, i recommend laffly, the 3 poin point jump would have only made sense if he had been relieved before the tough restructuring kicked in, in the '60s. after, it make nos sense at all to me. even though that move has been currently been repeeled, i wouldn't yield the missed euphoria, because despite mcdonald's herk lean efforts, they weren't able to catch up to colgate and unilever, although it would have in months. the market wants to rotate out of the consumer package goods into the more industrial financials that do better with real world growth coming back. that has been a time honored
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investment strategy. i embrace it. why not exit or insure proctor again unilever or colgate or kimberly even if you think the world of laffly. there are better frisch i fish to fry and better toothpastes and diapers to own. stay with cramer. ben bernanke will not stop by. ly tell you why. no fifth amendment for lois lerner and senator tom coburn reports from oklahoma next up on the kudlow report. just like a tablet. so easy to use, it won a best of ces award from cnet. and it comes inside this beautifully crafted carrying case. introducing the all-new 2014 chevrolet impala with the available mylink system. ♪ [ beeps ] ingeniously connecting you to your life and the road. that's american ingenuity to find new roads.
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>> with the big utility deal is after the close, i like to say i like bull markets. i'm jim cramer on "mad money," i will see you tomorrow! how's the sequester been? you said many times from this podium it was going to really hurt the economy. yet, you have to acknowledge, because you want to acknowledge, obviously, the economy is doing pretty well. >> all right. that was the big question at today's white house brief. it was exactly right. the economy is doing reasonably well. the spending cuts sequester was just a bunch of scare tactics. in fact, smaller governments actually is helping the economy to grow. first, the briefing was filled with questions about the many scandals continuing to face the white house, including a point blank question about whether attorney generaler rick holder has committed perjury. none of this is going away, folks. and dr. bit


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